Education
About Us
Working with TipRanks
Follow Us
Air Products and Chemicals (APD)
NYSE:APD
Top Page
Air Products and Chemicals
(NYSE:APD)
Rating:63Neutral
Price Target:
$299.00
▲(0.60%Upside)
Positive Factors
Leadership
APD is now heading in the right direction under new leadership, indicating potential for future growth.
Project Development
The NEOM green hydrogen production asset is now 80% complete and set to come on at the end of 2026 without an indication of incremental cost overruns.
Strategic Vision
New management has unveiled a strategic vision targeting high single-digit EPS growth from 2026 to 2029, which indicates a positive long-term growth plan.
Negative Factors
Earnings Guidance
The company lowered its full-year earnings guidance, which suggests a less optimistic outlook for its financial performance.
Financial Performance
Air Products and Chemicals, Inc. reported earnings and EBITDA that were below estimates, impacting its financial performance negatively.
Project Risk
APD will exit three projects, resulting in up to a $3.1bn write-down, highlighting significant potential risks.
Air Products and Chemicals (APD) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$66.29B
Dividend Yield2.4%
Average Volume (3M)1.08M
Price to Earnings (P/E)43.3
Beta (1Y)0.77
Revenue Growth-1.09%
EPS Growth-37.71%
CountryUS
Employees21,850
SectorBasic Materials
Sector Strength73
IndustryChemicals - Specialty
Share Statistics
EPS (TTM)2.69
Shares Outstanding222,544,220
10 Day Avg. Volume1,027,823
30 Day Avg. Volume1,078,496
Financial Highlights & Ratios
PEG Ratio>-0.01
Price to Book (P/B)4.51
Price to Sales (P/S)0.00
P/FCF Ratio-15.30
Enterprise Value/Market Cap1.23
Enterprise Value/Revenue1.68
Enterprise Value/Gross Profit21.17
Enterprise Value/Ebitda3.80
Forecast
1Y Price Target
$324.64Price Target Upside9.23% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering11
Air Products and Chemicals Business Overview & Revenue Model
Company DescriptionAir Products and Chemicals, Inc. (APD) is a global leader in industrial gases and related equipment, serving a diverse range of industries such as energy, healthcare, and electronics. Founded in 1940 and headquartered in Allentown, Pennsylvania, the company provides essential gases like hydrogen, nitrogen, and oxygen, as well as chemicals and equipment essential for various industrial processes. Air Products is recognized for its innovative solutions in air separation, hydrogen for clean energy, and gasification technologies.
How the Company Makes MoneyAir Products and Chemicals primarily generates revenue through the sale of industrial gases and related services. The company's key revenue streams include on-site gas production, merchant gases, and equipment sales. On-site gas production involves long-term contracts with large-scale industrial customers, where Air Products installs and operates gas production facilities directly at the customer's site. Merchant gases are sold to a broader market, including small and medium-sized enterprises, through a network of distribution channels. Additionally, Air Products earns revenue from its equipment and engineering services, providing customized gas processing systems and technologies. Strategic partnerships, such as joint ventures and collaborations with other industrial companies, also contribute significantly to its earnings by expanding its market reach and technological capabilities.
Air Products and Chemicals Key Performance Indicators (KPIs)
Any
Operating Income by Geography
Shows the profitability from different regions, highlighting where the company is most efficient and where there might be challenges or opportunities for improving margins.
Shows the profitability from different regions, highlighting where the company is most efficient and where there might be challenges or opportunities for improving margins.
Data provided by:
Main Street Data
Main Street DataAir Products and Chemicals Earnings Call Summary
Earnings Call Date:May 01, 2025
(Q2-2025)
| % Change Since: 10.34%|
Next Earnings Date:Jul 31, 2025
Earnings Call Sentiment Neutral
The earnings call highlighted Air Products' strong core business and strategic refocus on traditional industrial gases, while addressing significant challenges with underperforming projects, cost overruns, and lower earnings guidance. Efforts to improve productivity and reduce costs are underway, but financial impacts from project issues and cancellations weigh heavily.Q2-2025 Updates
Positive Updates
Strong Core Industrial Gas Business
Air Products' core industrial gas business, including on-site projects and merchant business, has about $12 billion in sales and an operating margin of 24%. The company sees potential for margin improvement and significant value unlocking through disciplined cost, productivity, pricing, and operational excellence.
Progress on Saudi Arabia Green Project
The Saudi Green project is progressing well, with 4 GW of solar and wind power generation expected to be completed by mid-2026 and commissioning of electrolyzers and ammonia production to follow. Product availability is expected in 2027.
Refocusing on Core Business
Air Products plans to return to its core industrial gas business model, investing about $1.5 billion per year in core industrial gas projects, focusing on high-return opportunities.
Cost Reduction and Productivity Improvement Plan
Air Products plans to reduce its headcount by 1,300 positions, with an additional 2,500 to 3,000 reductions planned between 2026 and 2028, aiming to align with 2018 levels adjusted for growth.
Negative Updates
Underperforming Projects with Significant Overruns
Air Products has $5 billion in underperforming energy transition projects with substantial cost overruns, negatively affecting financials. Some projects were designed for non-contracted pipeline sales and the hydrogen mobility market, which is delayed or reduced.
Negative Impact from Project Cancellations and Cost Reductions
Air Products took a $2.3 billion after-tax charge in Q2, including project cancellations and cost reduction measures, affecting financial results.
Alberta Project Cost and Schedule Overrun
The Edmonton Net Zero hydrogen project cost has ballooned to $3.3 billion, with completion now expected between late 2027 and early 2028, due to execution challenges and severe weather impacts.
Challenges with Gasification Projects in China
Three gasification projects in China have close to zero EPS contribution, with issues in project execution and financial performance.
Earnings Miss and Lower Guidance
Air Products reported Q2 adjusted EPS of $2.69, below previous guidance of $2.75 to $2.85, due to changes in cost estimates and lower helium contribution. Full-year guidance was also lowered to $11.85 to $12.15 EPS.
Company Guidance
In the recent earnings call, Air Products' leadership provided detailed guidance, emphasizing a strategic refocus on its core industrial gas business to enhance profitability and efficiency. The company aims to achieve an adjusted operating margin of over 20% for the fiscal year 2025, with expectations of double-digit adjusted return on capital employed (ROCE) and earnings per share (EPS) of around $12. Significant capital discipline is planned, with annual investment in core industrial gas projects projected at approximately $1.5 billion. Air Products also outlined its cautious optimism regarding large projects in Saudi Arabia and Louisiana, emphasizing that progress will rely on securing firm offtake agreements. The CEO highlighted ongoing efforts to address underperforming projects, with a focus on aligning future investments with high-return thresholds. By 2030, the company aims to achieve a 30% adjusted operating margin, mid to high-teens adjusted ROCE, and greater than 10% compounded EPS growth. Additionally, efforts to rightsize the organization include planned headcount reductions to return to 2018 levels, adjusted for growth, and improve productivity by $100 million annually.Air Products and Chemicals Financial Statement Overview
Summary
Air Products and Chemicals exhibits strong profitability with solid margins and efficient cash generation from operations. However, the decline in revenue and high capital expenditures resulting in negative free cash flow pose potential challenges. The balance sheet is well-managed, but increasing debt levels require monitoring to maintain financial stability.Income Statement
Air Products and Chemicals shows a robust TTM gross profit margin of 32.25% and a net profit margin of 12.75%, indicating strong profitability. However, a revenue decline of 0.66% from the previous year suggests challenges in growing sales. The EBIT and EBITDA margins of 12.12% and 21.99% respectively, demonstrate effective cost management, although the margins have decreased compared to prior years, reflecting increased operational costs or reduced pricing power.70
Positive
Balance Sheet
The company's debt-to-equity ratio of 0.98 is reasonable, indicating a balanced approach to leverage. A return on equity of 9.14% TTM suggests moderate efficiency in generating returns for shareholders. The equity ratio stands at 43.17%, reflecting a solid equity base relative to total assets. The balance sheet reflects adequate financial stability, though an increase in total debt over recent years could pose a future risk.65
Positive
Cash Flow
The operating cash flow to net income ratio of 2.19 TTM is strong, highlighting efficient cash generation from operations. However, the negative free cash flow TTM, primarily due to high capital expenditures, is concerning for liquidity. The company needs to manage its investments carefully to avoid prolonged cash flow deficits.50
Neutral
| Breakdown | Sep 2024 | Sep 2023 | Sep 2022 | Sep 2021 | Sep 2020 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 12.10B | 12.60B | 12.70B | 10.32B | 8.86B |
| Gross Profit | 3.93B | 3.77B | 3.36B | 3.14B | 3.00B |
| EBITDA | 6.49B | 4.42B | 4.22B | 3.97B | 3.72B |
| Net Income | 3.83B | 2.30B | 2.26B | 2.10B | 1.89B |
Balance Sheet | |||||
| Total Assets | 39.57B | 32.00B | 27.19B | 26.86B | 25.17B |
| Cash, Cash Equivalents and Short-Term Investments | 2.98B | 1.95B | 3.30B | 5.80B | 6.36B |
| Total Debt | 15.01B | 11.03B | 8.33B | 8.22B | 8.31B |
| Total Liabilities | 20.90B | 16.34B | 13.49B | 12.77B | 12.73B |
| Stockholders Equity | 17.04B | 14.31B | 13.14B | 13.54B | 12.08B |
Cash Flow | |||||
| Free Cash Flow | -3.15B | -1.42B | 303.70M | 877.70M | 755.70M |
| Operating Cash Flow | 3.65B | 3.21B | 3.23B | 3.34B | 3.26B |
| Investing Cash Flow | -4.92B | -5.92B | -3.86B | -2.73B | -3.56B |
| Financing Cash Flow | 2.62B | 1.61B | -1.00B | -1.42B | 3.28B |
Air Products and Chemicals Technical Analysis
Positive
297.22
Price Trends
281.30
Positive
280.17
Positive
294.90
Positive
Market Momentum
4.62
Negative
64.16
Neutral
87.59
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For APD, the sentiment is Positive. The current price of 297.22 is above the 20-day moving average (MA) of 290.68, above the 50-day MA of 281.30, and above the 200-day MA of 294.90, indicating a bullish trend. The MACD of 4.62 indicates Negative momentum. The RSI at 64.16 is Neutral, neither overbought nor oversold. The STOCH value of 87.59 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for APD.
Air Products and Chemicals Risk Analysis
Air Products and Chemicals disclosed 17 risk factors in its most recent earnings report. Air Products and Chemicals reported the most risks in the "Legal & Regulatory" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Air Products and Chemicals Peers Comparison
Overall Rating
UnderperformOutperform
Sector (44)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
71 Outperform | $221.24B | 34.11 | 17.20% | 1.23% | 0.78% | 6.75% | |
69 Neutral | $9.21B | 10.15 | 16.16% | 4.14% | 2.78% | 1.50% | |
64 Neutral | $26.11B | 19.75 | 18.47% | 2.36% | -7.67% | -0.58% | |
64 Neutral | $85.94B | 34.05 | 62.43% | 0.88% | 0.31% | 2.66% | |
63 Neutral | $66.29B | 43.29 | 10.45% | 2.40% | -1.09% | -37.71% | |
63 Neutral | $32.05B | 40.24 | 0.06% | 2.11% | 4.51% | -121.68% | |
44 Neutral | C$980.54M | -6.82 | -13.68% | 1.81% | 17.37% | -32.98% |
* Basic Materials Sector Average
Performance Comparison
APD
Air Products and Chemicals
297.22
44.85
17.77%
EMN
Eastman Chemical
77.33
-16.36
-17.46%
PPG
PPG Industries
115.02
-8.04
-6.53%
SHW
Sherwin-Williams Company
340.21
0.28
0.08%
DD
DuPont de Nemours
74.80
-2.66
-3.43%
LIN
Linde
471.49
33.95
7.76%
Air Products and Chemicals Corporate Events
Executive/Board Changes
Air Products EVP Sean Major Resigns Effective July 11
Neutral
Jul 8, 2025
On July 7, 2025, Sean D. Major resigned from his position as Executive Vice President, General Counsel and Secretary of Air Products and Chemicals, Inc., effective July 11, 2025. The company has yet to announce his successor, and Mr. Major will receive severance and benefits as per the Executive Separation Program, which was detailed in the company’s 2025 proxy statement.
The most recent analyst rating on (APD) stock is a Buy with a $375.00 price target. To see the full list of analyst forecasts on Air Products and Chemicals stock, see the APD Stock Forecast page.
Private Placements and Financing
Air Products Issues $1.1B Notes and €500M Eurobonds
Positive
Jun 11, 2025
On June 9, 2025, Air Products and Chemicals, Inc. entered into underwriting agreements for the issuance and sale of $1.1 billion in U.S. Notes and €500 million in Eurobonds. The proceeds are intended for general corporate purposes and to repay commercial paper obligations, potentially strengthening the company’s financial position and market presence.
The most recent analyst rating on (APD) stock is a Buy with a $375.00 price target. To see the full list of analyst forecasts on Air Products and Chemicals stock, see the APD Stock Forecast page.
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.